Saturday, August 31, 2019

Economic Disparity Essay

The term ‘economic disparity’ would literally translate to the differences in incomes and wealth between different economic strata in society. In any economy, therefore, disparities are bound to exist, since levels of skills, contribution, ownership and wealth do vary. This is as true of fully developed economies as it is of developing and underdeveloped ones. In India, however, we use the term very specifically, to point to the yawning gap that exists between the rich and the poor. We acknowledge, with occasional embarrassment, (and opposition parties with ostensible anguish), the fact that, even six decades after independence, this gross disparity still exists. To us, it is a reminder that we have not yet been able to eradicate poverty – the state in which more than a third of our population exists, without the minimum in food, clothing, shelter and dignity. There is no doubt that, as the economy develops, various economic determiners will show increase at the national (or gross) levels – investments, assets, production, incomes, and so on. This, in turn will progress to growth in national wealth to a point where, as a nation we are as well off or ‘developed’ as any other. However, it must be remembered that a nation is but a sum of the different strata of the society within it, just as a body is the sum of its parts. Looked at in this manner, it can understood that only when all the parts have the minimum required development (or ‘health’), that the whole can be considered developed or healthy. At first sight, it would seem as if there’s a difficult choice to be made – that investing in economic growth would mean the inability to devote national effort and finances towards lifting the poor out of their morass. However, when we take a broader view, we understand that it is through the first that the second objective can be achieved – while the benefits of economic growth must first fuel further economic growth and then be shared by all economic strata, the greater share must find its way to those at the very bottom of the pyramid, the economically disadvantaged, till we achieve the banishment of poverty. This seems altruistic, and may be so. However, it makes good economic sense too. Those lifted out of poverty would be freed from the need to devote every moment to sheer existence and subsistence, and would therefore be able to make positive contributions to social and economic productivity, to economic growth. Both objectives – economic growth and poverty alleviation, are therefore related and should be targeted together, for national development. Clearly, then, it is only when we have eradicated poverty, that we should consider ourselves developed in the true sense. This is why sociologists, and an increasing number of economists, are of the view that true development is reflected not in cold economic indices such as GDP, GNP or GNI, but in the HDI (Human Development Index) which takes into account three critical ‘human’ parameters – life expectancy (that reflects nutrition and health), literacy (that reflects employability) and standard of living (that reflects dignity).

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